Spring has sprung, Iran is holding Western hostages,oil prices are up, real estate and lending are goin' down, bad loans are ticking in the banks. we're bogged down in an overseas civil war, we have a Republican government imploding, the Demo's are about to have a bloody campaign between non-compelling candidates. Welcome to 1969,70,72,'76,'80,84,91 and a lot of other bad years. 

"Life is tough, but it's tougher when you're stupid."

-- John Wayne

Charts and tables up. I've been almost exclusively long from 9/04 to 2/07 and I'm up 40% to show for it. Now I'm at 70% cash down from 90% cash to 60%cash back to 70% cash all as of last week. And it's all because I'm concerned about the future...

It's time to think and write about creating a framework of expectations for the near and far future. With the expectations set down on paper, a plan as to what to do will pretty much follow. Then I gotta see what's achually gonna be comin' down. That'll measure how well my expectations are bein' met. And that will be the key as to figgarin'out whether or not executing my plan will cross that fine line between brilliant and stoopid. Stay tooned. Doin' my taxes take priority...
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What everybody wants is to be given is the key to always winning with minimal effort. What they get is.... 

Charts and tables up.

At the end of last week I went from 90% cash to 60% cash. The rapid trading rules locked me out of my preferred funds for another week. But there still was a way for me to get back in the market with effective exposure to the current upside movement.
Here's how it's done....(CLICK IT)

Note that Europacific and LA research have been smokin' hot. I've been big but not exclusive there. Risk and all that. American Growth has been hot but has not been stellar lately. So I've lightened up there recently. Vanguard has lagged overall but has heated up recently. I've not been there because there have been better places to be. So both funds were available for me to invest in when we got the Fed induced updraft last week. So I put 1/3 of my cash into the those funds.

Check out what's been happening this year...(CLICK IT)

We had a whoosh down the last week of February. Was it going to be as big as last year's whoosh? We don't know that yet. Soo... I prepared for the possibility. I went to cash with the ability to immediately get back into the market if it was a false alarm. I'm equivocal about what kind of alarrm it was so I'm 1/3rd back in. Iran, housing, interest rates, credit, White House under siege, etc on the downside. World growth being a runaway locomotive, new technologies, new data distribution paradigms on an industrial and investment level, revolutionary changes in media and politics, on the upside. Whatcha gonna do?
Stay tooned....
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Da Saturday website an' blog thing 'n all that that entails, I mean, ya know what I mean? 

"The master in the art of living makes little distinction between his work and his play, his labor and his leisure, his mind and his body, his information and his recreation, his love and his religion. He hardly knows which is which. He simply pursues his vision of excellence at whatever he does, leaving others to decide whether he is working or playing. To him he's always doing both."
James A. Michener

Charts and tables ready.

But this time it's the 3rd party website creation/editor service that I'm usin' with my host site that's down. Bummer, dude, I mean it's all negative downer kinda stuff an' all that an' it's hangin me up...

Chartz and tablez up.
More to come....

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Stepped In a HOLE!!!! 

Kinda saw that one coming....Click onna chart...

Notice when the downturn started and how volume stayed steady... Notice the one huge drop on 2/27 and the big volume that day as a lot of people bailed... Notice the low volume bounce. The market started back up but on declining participation... There was no real enthusiasm and a lot of trepidation... Then today.... the other shoe dropped and a lotta people sold.
I'm still cash big time. This has NOT played all the way out. I'm watching.... I will buy back in. It'll be when I think it's the right time and at my pace and on my terms. Stay tooned. See ya at the hall.
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Never A Dull Moment. GUARANTEED!!! Watch This........... 

"The art of investment is the art of selling. Buying is a lesser skill and holding requires no skill at all."
-- Harry Schultz

Chartz and tablez nowhere. For once it is not K and G hangin' me up. This time my charting service is installing a new UPS for their servers.


A buddy of mine went to about 90% cash in mid Feb. Another buddy went to cash on the first bounce. I went partially to cash Jan 10 and then in and out for a while and finally all the way to cash on 2/28, the first big LOOOK OOUT BEELOooow!!!!!.... I've been basically all cash since 2/28 and as a result I missed some of the downside and all of the bounce. It's cost me between $60 and $100 in lost opportunity as of today. It bought me at least a coupla grand worth of peace of mind.

Every day you hold cash or bonds, you shoulder inflation risk as the return on your money does battle with inflation and fees. Every time you own stock, you shoulder investment risk as your stocks might go down and fees eat at your balance. Every time you are out of the market, you shoulder opportunity risk as what you could have had if you had made more right than wrong decisions is lost forever. It gets really hairy if you invest in offshore stuff.
International diversification, which I recommend for the sheer thrill of losing money around the clock in all sorts of different countries for reasons you cannot articulate, inevitably involves currency risk.
--Howard Simons

But ya ain't gonna live happily now and happily ever after on passbook rates unless you're already retired and well off, so you have to choose what risk you want to shoulder and when it makes sense.

So if you follow what I post, you'll see that I have tended to be fairly overweight in the RERFX foreign stock fund choice in our 401a. In fact when I started to go to cash the first time this year, at one time the RERFX was the only fund I kept. Here's why; AMG Data Services provided fund flows for the week ending 1/31/07 record that domestic equity funds excluding ETF's had a net cash outflow of $55 billion dollars and non domestic funds had a net cash inflow of $2.56 billion. This is not atypical. I've been watching money flow overseas for a while now. Big money and smart money and hot money has been in natural resources and the hottest international economies since the dotcom crash. You don't think they rode out the crash all the way to the bottom here, did you? That's the little guy's job. Check out the chart of the McMorgan big cap equity fund vs a Fidelity big cap, South East Asia and Latin America funds, and a natural resources fund...

First off, finding that the Fidelity fund is a better preforming fund than McMorgan is no surprise. Second, check out this chart and the ones on my website. The action has been better some places than others. Specifically, and until recently, away from the big caps. That's why the American Funds EuroPacific and the Lord Abbet Small Cap have excelled. And that's where I've been leaning the hardest. But that's not the only place I'm putting my money down. The word risk is all over the page here and I try to listen to people I respect. That's why I've avoided the losers and underperformers and put my money in more than one winner. I'd have made more if I only had money in the best performing fund. Instead, I've trailed the very best two funds despite being heavily invest in them. That's the price of discipline and diversification. And discipline is why I'm in cash now.

Another key to what I'm doing is the word "flow" as in "fund flows". Fund flows in drives up prices and create a self reinforcing dynamic. Think homes in Palm Beach.
http://www.palmbeachpost.com/business/c ... _0226.html
Fund flow statis creates a whole lot of tension and pretty quickly creates flow out. Fund flows out drive prices down and create their own dynamic. Every game comes to an end. There will come a time when the flow of funds out will scragmaul what they built up in a relative eyeblink. Think homes in Palm Beach. So you get while the getting is good and look away from your money at your risk. You can't do that with your home. Some things ya gotta ride out the ebb and flow. But depending on circumstances and inclination, and little time and energy reacting to the ebb and flow in the 401a can be well spent.

I'm kinda expecting some more downside. But cash is for buyin' so I'm looking for an opportunity to do so. It's the ebb and flow thing, ya know? If we don't go to zero, we'll go up and there'll be an other opportunity to make money. And then when they go down, we'll get an opportunity to sell and keep some money.
The wheels on the bus go 'round and 'round.....
See ya at the hall.
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The Bad News Is, Ya Ain't Seen Nothin' Yet. The Real Bad News Is, I Think It's Just Started...  

Just remember one thing: there are no good stocks. They all suck. Even those that are making you money are going to turn on you sooner or later. The only stock you should say anything good about is the one you no longer own that made you money.

--Reverend Shark

Charts and tables are up. Our "SPECIAL" day from last week continues to repeat like a bad burrito. Look at the charts for our funds since June of last year. We made a very nice return and the overriding direction for the funds was up. There was little to no give and take, the swings in price (volatility) were muted, and those down side moves were stored up for the future and did not fade away into the aether. So all the medium size swings around the mean we haven't had have wound up and finally been delivered all at once and the direction is down. Successful investors with profits to protect and fresh money invested as of the new year are puking the positions back out NOW and going to cash or bonds. There is a lot of fear and the call is "Get Me Out NOW, I don't care about the price!!!! And it is world wide. It started in China and is washing in waves around the world. At the same time, all the talking heads and pundits that talk to the individual investor are advising caution, not to panic, and to hold on for the long run. "Don't react, ignore the man behind the curtain, everything will be fine once this is over.". That's all fine and dandy to those to whom that makes sense. Me, I'm 80% cash as of last week and going to even more cash tomorrow (Tues). That's saved me a tidy sum as of today.
Selling when it makes sense is the other side of buying when it makes sense and the alternative to not just making my 401a a one decision thing. This is what I gotta do. I believe our sticking with McMorgan as our sole money manager for so many years cost us big time and I'm putting in the time and effort now that I should have put in then.

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Well, wasn't today special. I've got a full plate tonight and I'm busier than a long tailed cat in a rocking chair factory. But I've had the time to set up the trade to go to 80% cash in the 401a at the close of the market tomorrow. I expect to check the market at lunch tomorrow and decide whether to let the trade trigger. There's always the chance for a miracle. But I'll most likely let the trade go through.

I've been 100% long at times since 9/04 and mostly very heavily long most of the time.

I expect to balance my WFO long positions when the market is red hot with my best tortoise imitation when the market is not, or in the bomb shelter when the market is looking for blood...like now.

I've got the ways and means to put it all back in the market in a day if it works out to be the best thing to do. So I'm not risking much opportunity to be out of the market for a day, a week , a month or longer at this point, and I'm definitely avoiding falling stocks when I'm mostly cash. I'm focussed on keeping what I've earned since 9/04 and not leaving any more money than I have to on the table...

This ain't my first dance and I understand that stocks aren't GDP futures and are on occasion only tenatively related to the state of the country's or the company's business. So it ain't necessarily the end of life as we know it. Although it might be. It definitely is a smoking crater. I'll hafta see what it looks like down the road. So I've got a mission and a plan and the mindset to see it through. And I'll write about it here. See ya at the hall.


We had a bounce. Looking at my IRA's and my trading acount and the 401a, I'm unimpressed. The bleeding stopped, but the bounce may be a dead cat (parrot) variety. The market character has changed. Since summer of last year, anything but blind commitment to buying and holding made you a loser. Yesterday that changed. I suspect a lot of investors/traders still want out and are waiting to get even before they leave. I think they will capitulate over the next month or so and sell, especially if the market drifts down... I think there will be mutual fund redemptions coming in over the transom this weekend. More selling Monday. I've got a lot of buying power and after the selling stops, whenever that is, I'm going to use the buying power to start the whole investing/trading process over again.

Or, there's many tons of US investor money overseas. (More about this this weekend) If that money comes back immediately and goes into the domestic market, it might counter the selling and send the market up bigtime. In that case, I'm back in as soon as the money shows up and the market lifts. There's a lot of different possibilities. I think about them all, but I only play the ones that actually happen.

My returns on my 401a are excellent. It looks like they would have been even better if I'd just dumped all my money into the Aggressive Portfolio and left it alone. But there are times when I feel real cautious. Like when I went partially to cash January 10TH. So I act on it and sell. It's cost me some money each time I did that before. Regardless, I think it's the right thing to do. Let's see how it works out this time
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WhatamIdoin' now? Well, that's a really good question, and thanks for the call..... 

Charts and tables up. KandG won't let me into the site. I tried a coupla hours later and all is working now...
I've got a big family weekend goin' on but it's time to unleash some thoughts that need to be photons in the aether. So maybe later in the weekend, you'll read why I went to cash and the American Funds Europacific Fund when I got cautious in January instead of just cash, and why the Board of Trust is the way it is instead of the way it should be.
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Nothin' to say....Know what I mean? 

Charts and tables up. More to come

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Another week, another battle. First, to minimize risk and second, maximize return. 

"Success in almost any field depends more on energy and drive than it does on intelligence. This explains why we have so many stupid leaders."
-- Sloan Wilson

Charts and table up....

Another week, another battle. First, to minimize risk and second, to maximize return. Understand that when I'm talking about risk, I'm talking about two kinds of risk. The first kind of risk is outright losing money for no good reason other than laziness and ignorance. Like when we lost approximately 25% of our pension funds between 2000 and 2003 by not knowing that our money manager was underperforming. Or by being long stocks regardless of whether or not that is working. The second kind of risk is not making money for no good reason other than laziness and ignorance. Like being heavily invested in bonds when that is an inappropriate allocation of funds for your particular circumstances. When I'm talking about maximizing return, I'm taking about making the effort to take care of the pension savings that you worked for. If you recount the money you get when you cash your check and when you get change, fix the roof when it leaks, and change the oil when it's time, taking care of your 401 is more of the same. And not much more work.

I've way over performed since 9/04 as per the charts on my site. That was easy. Now it gets harder.Again as per the tables, I'm allocated to primarily one stock fund and 30% cash. It's cost me return to date, as my personal account is lagging the returns of all the individual stocks funds.
It's like buying insurance. The insurance premiums are a waste of money... hopefully. Some times you are unfortunate enough to have the insurance pay off. I judge that the risks in the domestic market are outsize to the downside, so it's about cash. If I'm right, I'll make up some of the returns I've missed out on. If not, I've traded a lttle money for peace of mind. It's not like I haven't been on the other side of the trade before.
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Daba Dooba Daba Dooba Deeba Dooba Day... I dug up some J.Geils Live and spun it up last night.I remember when the Filmore Auditorium was open 6 days out of 7 and ran 2 shows a week.I figured to go more often the next year... There's a lot of fun music gone forever.  

Charts and tables up. More to appear here this week. I bought a major brand name computer a week ago, my first since my original IBM in the early 80's, and am paying the price for not rolling my own. As it works itself out, I'll post here.
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Testing...Testing...One, Two, Three....Anybody out there? 

"Change has a considerable psychological impact on the human mind. To the fearful it is threatening because it means that things may get worse. To the hopeful it is encouraging because things may get better. To the confident it is inspiring because the challenge exists to make things better."
-- King Whitney, Jr.

Charts and tables up late on a Sunday night....Yet another Katastrophic Komputer Katastrophe this weekend. I'm switching over to a new system later this week. Makin' a change....ya know. Things will probably be quiet until I'm 100% up....Or not.

Check out the chart. This is the performance of the funds in my 401a since I went big to cash, heavy on the rerfx, and a just a little here and there in the other funds. CLICKONNIT to see it better...

So far, so good. There's a lotta year left to go. Eyes open, readin' and thinkin', ready to play what I think offers the best reward with the least risk. And don't EVER think that doing nothing reduces the risk. Events around the recent election got me to calculating what sticking with McMorgan as our sole investment agent cost us versus some more responsible investment strategies. Did we even CONSIDER making a change?


Moved about 10% outta cash and into LAVLX.
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If this was really your retirement funds and not just a practice exercise, don't you think you'd have been given better instructions? 

One of the most difficult investing skills to master is being persistent and confident while not crossing the line to being stubborn and obstinate. It is a very fine line and you will never get it quite right now matter how hard you try.

Reverend Shark

Charts and tables up. Just like always...more to come later in the weekend. See ya then.
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Can there be any doubt about the '08 elections? 

Charts and tables up. There's big stuff going to start appearing here starting this week. I'll start with a new approach to running the 401a when things get volatile. We had a big hiccup in May and a very solid and unwavering run up into year's end starting in July. There is every reason for investors to lock in profits if they get spooked and there are a lot of reasons they may get spooked. Read the papers. Also realize that they need to cash out of current positions to buy new ones. Even if things go OK, once enough people start to lock in profits, it can get ugly and precipitous. Been there done that.
Check out the chart. Looks like at least a short term top and like things are starting to roll over to me. I've got something to protect.

I moved six of seven positions to almost all cash or all cash. I've only stayed with one heavily invested position. I'm locked out from reinvesting in five funds for 30 days as per the rapid trading rules. Did I do the right thing? I dunno.... Do I know what to do if it was the right thing to do? Yup. Do I know what to do if it was the wrong thing to do? Yup. Stay tuned and we'll all find out what the future brings. Check here this upcoming week.....
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Back to the same ol' same ol'. The new year is here and it looks a lot like the old one....... 

Charts and tables up. The numbers always look a little wonky for the first month or so; The B/P fund is down a tad and I'm down about 1%. So my percentage is 659.7893% worse than the B/P Fund over the three trading days of this week. That'll change.

I manage my family IRA's and so I take a look at more of the market than most people. I may step to the sidelines for a spell. You'll read about it here if and when.... Stay tuned.

I had a Kataclysmic Komputer Katastrophe this weekend. I lost a portion of the boot sector on my hard drive and all access to the internet and my files. I've gotten almost all the way back but at the cost of a coupla 3-1/2 hour of sleep nights. So I gonna be curt. I'm not comfortable about what I'm seeing in the market and the geopolitical arena. I'm situated much closer to mostly cash than usual. More about why later. I may not make this month's Union meeting behind this either. Or not. We'll see...
What did and where I am is shown below...

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Charts and tables up. I've been locked in a death struggle with a virus or two for the last two weeks. I'm still alive AND slightly less miserable. So there may be a future in which I can see across the room and get up and walk there without taking a nap before and after. Or maybe not. Screw it. I'll have all the time in the world to rest in about 45 years. I'll catch up then. In the meantime, there's a ton of updating and new stuff to do on the site for the new year. I'll post updates here as I make progress. There's a new entry on the COFGBLOG ESSAYS page of the site, there'll be an update to the downloadable EXCEL spreadsheet, more stuff on the REFORMING A PENSION FROM THE INSIDE page, and I gotta get together a primer on HOW TO FIGURE OUT WHAT JOE FACER'S DOING AND WHY IT WORKS FOR HIM (and what makes you different and how that would affect what you'd do if you wanted to do something like it). Stay tooned for more stuff to appear this weekend.

I've gotten a lot of housekeeping stuff done as of 1/1/06 noonish. I've editted almost every page. There's more to come...

Cap gains have been paid and posted to the 401a accounts. The charts have dealt with it and they look like they are supposed to without the cliffs at the end of the year. The B/P Fund did pretty well this year and set the crossbar up pretty high for self management. I'm pleased with where I stand. But I'm not that pleased...

Goals in investing can be dangerous. That's how all these famous hedge fund blow ups like Long Term Capital and Amarenth happen. Someone figures out a system to make money regardless of how the market does, they open up a hedge fund, and they promise high returns to smart money(meaning BIG money that demands quality active investment and real returns rather than excuses). They either name a figure or their strategy gives them superb results for a while. The funds seem to end up levering up big at some point because they either sense the chance to score big or because otherwise they won't meet their promises or match their records and smart money does't stick around to hear the excuses, it walks. And the hedge funds get handed their head by the market just like it does to everyone every so often. The hedge fund and the partners lose money, the partners take their money, if there's any left and walk, the funds close up shop and careers end. The markets are like the ocean. You can be smart about currents and winds and you can make the most of what you've got to work with and at times shine like a star. But you always have to remember that there will be times when being still afloat with almost all of what you had last year will be a brilliant victory. Take it and be proud of still being in the game. The goal I have is to do the smart thing as often as I can and make good progress whenever the wind is at my back, and if what I'm doing isn't working, stop doing it before I get hurt too badly and figure out what will work. I try hard to make money and I try hard to break even as the alternative. I try to be allergic to losing any money When I first looked at this year's numbers, I was disappointed.

So after all that setup, was last year a huge disaster? Nah. Over the last two and a quarter years, I've gotten 9%,13% and 11% returns. The 9% return over 4 months was not half shabby. The other two full year's returns were pretty damn good. The Balanced Pooled Fund did 5%,5%, and 9% over that same period. So I didn't double what the B/P Fund did this time like I've done twice before. I'm still up around 40% over the 2-1/4 years and way ahead of the B/P Fund. I was up 19% over what the B/P Fund did in '06. I just got a lesson in perspective. I did good. So'd the B/P Fund. You just don't stand as tall when the other guy ain't lying down...

Could I've done way better? Sure. Check out (Click On) the chart.

If I'd been 100% in the top two funds and I'd played the May/Aug hiccup better, I'd a been up around 40% for the year. So what. That stuff happens only a coupla three four times in a decade and it involves real risk. I've done it before. But I didn't do it here this year. I didn't even try. I'm my own client and I know what's possible and what's smart. Up 40% in two and a quarter years is good enough. If I don't give it back and I can do well enough in future years, that kind of performance will be huge for me compounded 10 or 20 years out.

On to next (this) year. I've gotta figure what to do next (now) about my 401a and about the Defined Benefit Plan. Stay tooned. See ya at the Hall...

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Seasons Greetings... A Festivus for the rest of us? Gimme a break and a gingerbread man and another egg nog while you're up.  

Here's what the current charts show for cap gains hiccups. It's a PITA, but better to have gains than not...Know what I mean,Vern?

Figure that the American Fund EuroPacific Fund does it's thing in the last days of the year, so there's more to come.

Charts and tables up. With qualifications... Some of the dividends and cap gains have been paid and the numbers are good. Some may be history but the numbers may not/don't reflect it yet. Complicating the whole ball o' wax is that the markets are a touch flakey right now. So are the down numbers cap gains or the market?

It's been a good, but a tough year. There was a huge whoosh down in May. If you were all guts and no brains, you bought back in in August and you look like a genius today for riding the whoosh back up. If you were smart, you waited to see that the re-launch upward of the market was for real and you waited for the first substantial pull back to get in at a reasonable price. That first substantial pull back happened last week. So you looked like an idiot for waiting for the next to last week of the year to make up for the previous 11-1/2 months. the longer you waited, the more you left on the table. This is why you stage the buys.

So this week, everybody not in a 401a (k) faced this dilemma... If you were brave (foolhardy), you look like a genius. Now you wait until January to sell and avoid the tax hit this year, assuming everybody else does too. Or if you were late to the party and have damn little to show for it, you wait to sell so what you did make looks as good as it can. Of course, if someone tries to beat the selling rush and sells late in December, they pay the taxes but they may avoid the next whoosh down. Or start the whoosh as everyone tries to crowd out the door first. So expect another whoosh down in January as everybody or only the people who left it until too late left lock in profits. Unless it happens in December. Of course if enough money pours in to the stock market due to the Santa Claus effect or the strong late year run, it may cause a very substantial bounce back from the December selling, if there is any, or swamp the January selling, which there will be some of. Or not. Either way. Most likely. Now if some of the money managers were able to hedge their portfolios with options, then they will be able to .... Nah, I think I'll go shopping instead.

If this was easy, everybody would be rich... So anyway, we'll have to wait for the statements to finally get the whole story... and wrestle with what to do about it...

I've moved a dollar or two around but I'm standing pretty pat other than bailing on RGAFX to try to game the Dec/Jan sales and putting another dollar back into LAVLX because they might be through with their recent spell of underperformance. We'll see. I'm getting my account balance up where I can't move much of a percentage around without triggering tading restrictions. I feel strongly about it both ways. Finally, there were some thing i was going to do as a Trustee if I got elected. I'm making a list and checking it twice to get started on it. Don't confuse lack of motion with nothing going on. Watch the site.

I bumped my contribution up for next year. Hopefully you did too. If you want to know what more there is to do to prepare for your future, get a fast connection, a large monitor, find out when I got a Saturday free, round up about ten other brothers and sisters, and rattle my cage about showing you what I do and why. Iff'n that don't happen........See ya at the hall.
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I want to thank everyone for their support in the recent election. I'm still going to get the job done. But it'll be done from the outside. Phase Two starts today..... Check out www.joefacer.com /Reforming a Pension Plan 

Some charts and tables up. Either the Lord Abbett Small Cap went down in flames big time 13%) in one day (pretty unlikely) or it paid a VERY substantial dividend or capital gains. (PFL).

===It was the latter case, the div/cap gains were $4.531 per share.===

I'll post my account charts and tables when I get it all plumb square and level... Which will be when I can get info on if and what the dividend/cap gains were from KandG or another source.

===Still waiting on this one for the very final good as gold number.===

But, if ya just CAN'T wait, figure Lord Abbett is buying you new shares at the price of 30.07. This works out to about one new share for each six you now hold. Call it about 13-15% capital gains this year.

For those who are unclear on what happened; the typical mutual fund has one portfolio of stocks/bonds but many different classifications. Some investors pay a load (commission) upfront, some pay it later on sales, some pay a higher commission, some pay a lower commision, etc. Some of the holders of the fund have to pay taxes on capital gains and some don't. Pension funds tend to use the institutional classification shares of the fund and so probably, most likely, pretty much everyone in this "r or x " classification fund, like 342 members, is in a nontaxable income/capital gains situation. But maybe not everyone. To make the whole thing easier and somewhat transparent, especially given that taxable and nontaxable entities may be in every class of fund, every year about this time, the fund takes the capital gains and dividends made over the past year out of each account in each classification, subtracting the value from the NAV (net asset value). So the price per share takes a hit. In the next coupla three or four days after, they rebate the capital gains/dividend taken out of each account back into the same account but in shares instead of dollars, at the price that the fund was when they subtracted the cap gains... After it is all over, you have the same amount of money but in more shares of a less expensive fund and the goverment and you have the capital gains reported in terms of a dollars/shares number if you indeed have to pay taxes on it. For the 401a, it ain't no big thing. You pay no taxes, you do nothing. For the taxable accounts, they use the cap gains number to report. Note it and stay cool. But it'll get your heart pumping the first time you see it, until you look at the calender. Expect to see it happen once in each fund, providing there are indeed capital gains to report.

+++ Growth Fund of America paid on the 19th @1.10 per share.+++

---EuroPacific pays on or about the 27th.---

Figure that the numbers are somewhat flakey until after it has occurred in each fund and has been recorded and acknowledged. Or you can look away until 2007.

The charts look like this... Ya can squint or clickonnit, but then ya gotta


Is Local 342 one of the investing proletariat? The excerpt below is from the link below that...

"But they don't seem to be disturbed by the inequality inherent in the financial markets in good times. So long as common stocks are rising and their money isn't obviously stolen -- that is, so long as the proletariat enjoys steady, if unspectacular, returns on its capital -- the investment lower class is surprisingly docile. It's as if the pleasure of any return at all has distracted investors from a comparatively low rate."

http://www.bloomberg.com/apps/news?pid= ... nist_lewis

With a $300,000,000 pension fund, given that there are limitations to what we can and should do with retirement money, are our funds being invested to give us the highest return with the greatest safety? Or is there a sizeable "tip" already worked into the tab when it hits the table because we know them and they know us and it's goin' on the union members card where they'll never see it?

Good readin'
http://online.wsj.com/public/article/SB ... ?mod=blogs

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Charts and Tables Up! The election weekend has got my schedule scrambled, my broker's IT team was locked in a death struggle with their computers and I was locked out some of my preferred tools for charts and tables. I downloaded a new version of Internet Explorer and it took a while to figure out the new features and beat some of them into a semblance of usefulness. In other words, this is just another day in the digital age. The issues have in part unwound and I'm in gear and rolling. See ya at the hall.

I've been thinking. What would I do if I was starting to self manage my own account? What if I had just gotten blessed to do so at the most recent meeting? What would I do and how would I handle it? I had already been investing and trading my family IRA's and an individual trading account regularly since 2001, so when we finally got some funds worth investing in in 2004, I hit the ground running with a full tool box and a modicum of experience. What tools and experiences have worked the best for me since then and which things aren't working as well? I could spend some time and effort looking back at this and make myself a better investor and trader... And I could give some thought to what the differences are between trading (my personal trading account) and investing (my 401a account). And I could give some thought to how I would handle it differently if I had only an hour a month vs an hour a week that I cared to spend on it. It's something you'll see and hear about in the near future.
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Tables and charts up.... My personal 401 account data is a tad flakey because the last two months contributions are a tad unreal. In the process of running the problems down, I found some months with the wrong hourly deduction. Checked your contribution history lately? It's not only the right thing to do....It's goldurned smart too. Especially if it puts dollar in your pocket.

The market's getting kinda skitish. Time to book some profits and pull in my horns on the 401? I'm gonna think about it and write about it here. Stay tooned.
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Charts and tables up. I've got a full plate for the weekend. There may be more posted here.....but no promises. My 401 account is long and strong, the return is smokin' and if I keep my head screwed on and don't get greedy, I'll keep most of it if the market starts to go south. I'll keep an eye on it all and let you know.

So at the meeting last week, Mike Mammini, the head honcho at our 401 plans showed how it makes very good sense to commit a substantial portion of your savings to the 401 plan. For late starters like me, it makes sense to commit the max. On a good year, that comes out somewhere between $15K and $25K placed in the 401a. He also says that you probably should look at it at least once a year, but probably not more often. After 5 years, that's about $80K to $140K that you've invested in financial instruments that are not guaranteed and have a history of going way up and way down real suddenly over the past coupla centuries. During that time, investing in stocks and bonds has made some people fabulously wealthy and beggared others. What makes YOU more uncomfortable, the thought of having to do a half hour a week of homework to make sure that that nothing bad happens to $100K plus of your money, or the thought that you might not catch a bad thing happening in time to save a substantial portion of your savings from going away forever? Is once a year often enough to look at something so important? If once a year isn't often enough to get your teeth checked, why is it often enough to look at your 401a?

The guy from McMorgan tried to scare members with TALES FROM THE STOCK MARKET, stories of tech investments gone bad. His example was PALM, where an investor could have lost 99% of his investment. SCARY!!!!! it's a good thing that McMorgan resisted requests to give us a tech fund to invest in...or maybe not...
Check out the charts of Palm and Apple below...CLICKONNIT

Put all your money in PALM and lose 98% of your money. Put 5% of your money in PALM and 5% of your money in AAPL, lose all the money in Palm provided you go deer in the headlights for the two years it takes PALM to go from $1000 to $3, and make 1000%+ (ten times your original investment) in AAPL by holding on for four years. I'll do that any day. It's called diversification and reducing risk to match the reward. It's what a smart mutual fund manager does. And a smart mutual fund manager wouldn't have ridden PALM all the way down FROM $1000 TO $3 and lost all the OPM (Other People's Money) along the way, charging them a fee to do so. Click on the link below.


and then click on "Protect Your Assets" under "The Apprenticed Investor" section on the right. Learn how it's done. In 50 years of reading a lot of disparate stuff, reading this article is one of the best spent chunk of time I can remember. CHECK IT OUT!

Check out the chart below. CLICKONNIT!

Shown is a tech Exchange Traded Fund (ETF) and a tech mutual fund vs our 401a growth fund and the S&P 500. I'm still not clear why we can't have a good tech fund available rather than tech funds used as something to be taken out of the closet every so often to scare us with.
And we gotta reconcile Kim asking us to double check our hours monthly because it is the responsible thing to do, and Mike telling us to look away from our investments for year at a time or longer because .... Well I can't figure out why because.
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===THE AFTERMATH=== Whatchur left with after all the addition/subtraction/multiplication/ and goezintas are done. 

The chart service is working right again. Charts and tables up like their supposed to be. Be that as it may, the Special Called Meeting came down and it was a major success in all ways. The attendance was as great or greater than a typical union meeting and a lot of people stayed to the end. At a few spots emotions ran high, a lot of good information got put out in front of the members, some existing misinformation got corrected, some new misinformation got out and some of it got corrected on the spot. Some more information is still need or is forthcoming. Time will take care of the rest. What's not ta like?

The meeting provided me with some new information and some updates on some existing info. Some of it changed my mind about some things, some of it gave me a new perspective what I already was pretty comfortable with, and some of it further supported my beliefs. You'll be seeing changes in the info on this site and in my campaign literature to reflect that.

Ah got stuff to do, but iff'n the good Lord's willin' an' the creek don't rise, I'll be back this weekend with more right chere, all ya all.
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Charts and tables up. The numbers and pictures speak for themselves. But I like to talk about it here anyway. Again, I'm doin' double what the Balanced Pooled Fund has done over the last 2 years. That's what I'd hoped to see. I've spoken with three 342 members in the last coupla days who are doing very well following a similar strategy to mine, but one they came up with on their own. It's all pretty cool.

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End of the year...cold weather, holidays, elections nationally and locally and at the Hall, Maybe some Big Changes coming down.... Sounds good to me. I'LL BE ATTENDING THE 11/15 401a MEETING.  

Charts and tables up. More to appear here this weekend. Union nominations this Thursday. The yearly openning to change your 401a plan contribution. Lotsa stuff. Check it out.
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It's a $400,000 day in the Bay Area. Indian summer and days like today are why your house is worth $400K more than one where the weather is going bad... 

Charts and tables up. If you check out my percentages in the various funds you will see that I committed a little more money into stocks and outa cash last week. The last two and a half years, I was pretty much head down and WFO in five stock funds and everything was fine. I was all GIC a coupla three weeks into the May crater '06 and that was cool. But I got overly cautious when we hit bottom and the Mid East went up in flames. I was late getting back in and the last six months have been pretty limp. Again, if things had gone to hell in a handbasket, my discipline woulda seen me through. But the market is on fire, I caught some of it and there may be more to go into the holiday season. So I've edged more into stocks and less in cash. But the last GDP number was pretty limp too. So if business gets soft, maybe the Fed will cut or at least not raise any more. And that'll mean a soft dollar. And that brings us to another issue. Look at the charts and this year's 401a worksheet on my web page. I've let 5 funds carry the load for the last two years. Two of them have been my main horses and I'm heavy into them going into this year's holiday season. But the EuroPacific fund is almost as hot as the small cap and hotter than the domestic growth fund and a falling dollar would give the return a boost. So it got the nod. But I'm concentrated in three funds and that means I gotta watch and act immediately and ruthlessly if the market turns on me. So, up 34% in a little over two years means I gotta go the extra mile to keep it as well as to make it. That's the way the world I live in works. Know what I mean, Vern? Nomination time. See ya at the hall.
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Election Countdown...Only a coupla three four or five or more weeks to go... 

Charts and tables up. I'm shooting for a new post to the "ELECT ME TO THE BOARD OF TRUST OF LOCAL 342 THIS DECEMBER" page on the website and blog this weekend. Check it out. Stay tooned for more to come.
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Special Called Meeting in November; Be there Or Be Square... 

Charts and tables up. It is almost a lock that UA Local 342 will have a special called meeting in November to address isues with our pension plans. This will be big and will affect every member who hopes to retire out of 342 and live happily ever after. Stay tuned, Spread the word and be there or be square.
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How's it goin'? Well it's goin' like this.... 

"Energy and persistence conquer all things."

-- Benjamin Franklin

Charts and tables up. Let's look at where I stand after two years and a coupla three four weeks of running my own 401 money versus leaving the money in the default choice; the "Balanced Pooled Fund" (BPF). My goal is to beat the BPF's rate of return by enough to justify the effort I'm putting into taking care of my retirement money, and to protect my self against losing money because of not putting enough effort into taking care of my retirement money.
Why do I even have to take care of my retirement money? Isn't 342 paying people to do that for all of us? They are supposed to be. I know better. The people watching our money are baby sitting it for us. The baby sitters/investment advisors/custodians earn fees first, for not doing anything stupid and second, for doing well enough not to lose us as clients and thereby losing the ability to charge us fees. You can't expect much from this set up and sure enough at times we haven't gotten even that. Read elsewhere on this site how they have been doing with your money. Suffice it to say that I wouldn't be doing this if all I had to do was let my money pile up in the 401 and the pension fund and grow itself into a fortune and a lifetime of easy living for me.
So... How my doin'? Pretty damn good. Check out my tables at http://joefacer.com/id11.html. I averaged almost 12% return/year over the first 16 months, from 9/04 through 12/05. Bull markets make almost everybody look like a genius and I was there to let it do its magic for me. My unstated until now goal is to get to the point where my investment return is substantially greater than my contribution. At that point, the hard work is done and my yearly investment returns start to approach what would make a really nice pension check. That makes living happily ever after a real possibility. I flirted with that kinda return in 2004 and 2005. 2006 is a different story. Check out the charts. Everything went great up until May. I stepped off the elevator just as it hit the top and went to almost all cash. This is the "not losing money" part of my "timing the market" plan. I started to get back in as stocks found a bottom but got scared back out by the Mideast war, rising interest rates, a slowing economy, the collapse of the housing industry and housing prices, and a desire to protect my gains from '04 and '05. In the meantime, stocks went up while I sat on the sidelines and waited for something major to tell me to get back in. I never heard the whistle and so for this year I'm hoping that the seasonal year end stock rally will show up like it usually does and get me back close to the 20+% up for the first half of the year that I had in my pocket in May. I may get there, I may not. And either way that's OK...
Having a workable plan and the discipline to stick with it is how you deal with not being able to tell the future and not being perfect on every move every day. I diversified among funds and it kept me from being totally invested in the two top funds, but it also kept me from having any money in the three or four worst funds and from having much money in the so-so funds. Getting out when it looked like the top cost me a litte performance here and there when I bailed out a little early for a month or two here and there, but it had me out during most of the downdraft from May to July. Being nervous from August to date has kept me with one foot in and one foot out of the market and has cost me some gains, but that's all part of the price of having a plan and discipline. And having the plan is the key to being confident about boosting the amount I'm putting into the 401 plan, going heavily to stocks at times, and sleeping well every night.
I'm up close to twice what the BPF is and I don't mean 3% for me compared to 1.8% for the BPF either. I'm up over 30%+ in two years. I've gotten both the "deer in the headlights" fear of the market going down and the "the week that stocks doubled when I sold out" fear burned out of me along the way and that's good too. It ain't all good all the time, but it's pretty damn good most of the time and ...

"No one that ever lived has ever had enough power, prestige, or knowledge to overcome the basic condition of all life -- you win some and you lose some."
-- Ken Keyes, Jr

So YEAH, I'm getting my money's worth outa running my own money. The more I put in and the more I earn, the greater the payoff. The quicker I stop the bleeding in a down market, the quicker I get back to even and start making progress again. But you know that. You read it on my webpage.

See ya at the hall....
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if you don't find it out here, ya ain't gonna find it out.  

Charts and tables posted. You'll find more here and on http://joefacer.com/id19.html by the end of this weekend. Copy it and get it out to the membership. Local 342 Brothers and Sisters will be glad you did....
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Successful investing is a lot like surfing; You can't make the ocean do what you want it to do. Instead you catch a ride to where it is going on its own and avoid getting wiped out on the way. Substitute "market" for" ocean". 

"Careful. We don't want to learn from this."

--Calvin & Hobbes comic strip

Charts and table up. Cross currents are what it's all about. There were three bubbles. The dotcom bubble, the housing bubble, the energy and other commodity bubble. The dotcom bubble created and destroyed a huge amount of wealth, especially in the Bay Area. The Fed drove interest rates to 1% and created the housing bubble to prevent the bursting of the dotcom bubble from driving us into a deep recession. Low rates and available money combined with the development of Brazil, Russia, India, and China to drive the price of commodities to sky high levels and create the commodity bubble. Politics in the MidEast added a $20 risk premium to oil. And corporate profits expanded like mad across the world. Then the Fed and other central banks, notably Japan's, took back what they had given. Rates went up and liquidity was withdrawn. But there was a lot of momentum in the world economy and the economic activity resisted the pull of gravity. But rates and gravity are relentless. The housing bubble is history and maybe the commodity bubble is too. The house next door went at the peak of the market and today an equivalent house can be had for 20% less. My neighbor is WAY underwater on her mortgage. GM is imploding and might be partnered with a French auto manufacturer?!!?!? Ford and GM merging? Chrysler in trouble too? Three year fixed and interest rate only mortgages are about to reset. There is seven months worth of housing inventory nationwide. Housing prices are going down in flames.
But...Energy prices are on the way down too and so are other commodities. Natural gas is down 66% from last winter and cluttering up the landscape. A warm winter may mean shutting down production even at the price of damaging the wells 'cuz storage is FULL. Oil is down from $78/bbl to under $60. It may go to $40 if the MidEast politics cooperates. That puts money in everyone's pockets. Base metals are down too. A lot of people have jobs and it doesn't look like they will lose them soon. The bond futures are predicting a rate cut next year. Are we going to have a soft landing of the economy? Will we see a replay of the 80's when my union had a ton of work and travel cards from all over the country while the unemployment rate was 12% nationwide? Probably not. This time everywhere else seems to have a ton of work on the books too. I just don't know. Maybe yes and maybe no. Could China blow up or the Mideast explode? Would that create a world wide economic crisis? Is there another bubble out there waiting to happen or just rate cuts and a Goldilocks economy advancing at a walking pace for years to come? I feel strongly about it both ways and neither either. That's why I'm 40% cash and 50% stocks in the three funds I like in the 401 and ready to add to stocks big time or bail out to all cash. I'm anted up and protecting profits and waiting for the next card to be dealt. You play what you're dealt when it's dealt. Only then can you make a rational choice between folding or going all in or someplace in between.

We may yet see the special called meeting on the pension in a month or two. Or not. Stay tuned.
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